Form 83(b) Election

Abstract

A Section 83(b) election is when one receives restricted stock, he/she has a decision to pay taxes on the value of the stock at the value it was received or to pay taxes when it vests. A Section 83(b) election means that the stock is treated as if it vests immediately, which results in higher taxes in the short-term but possibly much lower taxes in the long-term. A Section 83(b) election must take place within 30 days of receiving the stock.